Coming to America

On a mission to revolutionize the beer industry, Brazil’s hottest brewery is bringing feisty flavor to hoppy San Diego.

Under the cool night sky outside Denver’s Falling Rock Taphouse, a small, spirited group buzzes; standing at the edge is a young, scruffy-faced guy dressed in jeans, a plaid blazer and a bow tie. A woman tosses him a few exuberant words of Portuguese, and a proud, toothy smile stretches across his face. A few hours prior, the man, Jose Felipe Carneiro of Brazil’s Wäls Cervejaria, made not one, but two trips with his brother Tiago to center stage at the World Beer Cup awards, winning a gold and silver each in the Belgian beer categories. The Brazilian contingency—featuring notables like Paulo Schiaveto, co-organizer of South America’s South Beer Cup and other brewers, bloggers and fermentation scientists working to grow Brazil’s beer scene—are ecstatic, and tonight many of them gather here to toast their rock star brewer. A steady string of American beer geeks pass by, unaware of who he is, but that’s all about to change.

A few months later, I sit down to Skype with the face of burgeoning Brazilian craft beer. The excitement from the World Beer Cup hasn’t quite worn off, and the other World Cup, taking place in Carneiro’s hometown of Belo Horizonte (a two-hour flight north of Rio de Janeiro), plays muted in the background of his office. But we weren’t talking about recent glories in beer or soccer: Carneiro has bigger things to address. Two months after his success in Denver, Wäls began exporting beer to the U.S. market. Now, the brewery’s constructing a satellite brewery—in San Diego.

“First of all, the taxes are shit for us,” Carneiro says, when I ask him why he’d open a brewery in San Diego, of all places. If there’s one thing a foreigner needs to know about Brazil’s craft beer woes, it’s money: A non-existent craft beer infrastructure forces brewers to import equipment at high costs; low-quality hops—the only kind available in a country that can’t really grow them—run at a premium, scarce high-quality hops even more; and beer taxes soak up about 70 percent of a bottle’s retail price. Of course, those costs transfer directly to consumers. Unlike in the United States, where one Kickstarter campaign can fund the next Prairie Artisan Ales and a curious consumer can start a new hobby with a $2 IPA, in Brazil, craft beer is a rich man’s game.

As for Wäls, the brewery’s at capacity, and those exorbitant costs make the reality of expanding in-country nearly impossible. In early 2014, Brazil’s collective craft breweries—around 300 in total, comprising just 2 percent of the market share—began addressing their plight, positioning to launch a lobbying group akin to our Brewers Association. But it’s moving slowly due to infighting.

“Everybody who has a microbrewery has money, but people who have money also have problems with their ego,” laments Carneiro.

In the meantime, Carneiro’s going rogue, taking Wäls to California, an ingenious plan that will introduce Stateside drinkers to the inventive, usually exotic Brazilian beers and potentially quench the thirst for quality hops back home.

Up until 2009, Wäls and its brewing brethren operated largely outside the world of hops—or, at least, the pungent, citrusy hops as we know them in the States. German lagers and Belgian ales dominated the craft scene, often brewed using indigenous fruits, which are so vast in selection they’ve wowed American brewers like Brooklyn’s Garrett Oliver.

“A good American supermarket has maybe 25 percent of the kinds of fruit you’ll see in a Brazilian market,” says Oliver, who’s followed the Brazilian beer scene since visiting in 2004, and brewed a beer at Wäls in 2012. “Brazilians are mining all those flavors, from cajú and açai to all sorts of sugars. I’m not saying that American brewers don’t do this, but I think maybe the Brazilians are looking harder. They don’t have the hops to fall back on.”

But that’s changing, as Brazilian craft breweries and homebrewers are beginning to turn their attention toward American hops. Wäls’ dubbel and quadrupel—the ones that stole those World Beer Cup medals away from breweries where those styles were born—had long been calling cards. But since beer from Brooklyn Brewery and Flying Dog first hit Brazilian shelves five years ago, the hardcore craft beer consumers have grown thirsty for bitter, citrusy beers, and Brazilian brewers need hops to make them.

“The first hop here was American Cascade, and we all went crazy,” says Carneiro. “We have a beer that still sells a lot—a light lager that’s double-dry-hopped with Cascade. But now we have an imperial IPA, pale ale and session IPA, so we love hops, but we don’t have good access to them.”

And that’s why San Diego’s a logical landing place: The city has relatively easier, cheaper access to hops. The Pacific Northwest growing region is closer, and local breweries have long relationships with hop brokers. Carneiro’s new brewery—slated to open before the end of the year—will produce 5,000 barrels the first year, and 15,000 the following year. That’s if—and this is a big “if” in beer-soaked San Diego—locals decide to take notice.

“San Diego beer drinkers are, on the whole, very savvy,” explains Jacob McKean, who’s familiar with what it takes to open a brewery in the city since launching the buzzed-about Modern Times Beer last year. “The average level of beer knowledge here is much higher than it is in almost any other city. I think any brewery that makes world-class beer has a shot.”

Carneiro’s gunning for the attention of SoCal beer drinkers with the same exotic flavors that captured Oliver’s attention; beers like Belô Ipê, a fruity quadrupel aged with wood chips marinated in Brazilian cachaça (distilled sugarcane), and the acclaimed Petroleum imperial stout featuring domestic coffee and chocolate (both are available now on American beer shelves). But he’s also planning to go up against the region’s hoppier offerings, arguably the highest concentration of stunning IPAs and double IPAs in the world.

“I’ve tried Pliny the Elder two times in my life, and the beer’s amazing,” he says. “I don’t want to be better than them—I know they’re the best. But I do want [Russian River] to know my name in the next few months. I’m going to produce some hoppy beers, but with Brazilian character.”

But as Carneiro details the new venture, it becomes crystal clear that he wants more than fame and fortune. The journey to Southern California isn’t just about proving Wäls’ worth: Regardless of success or failure in the States, he’s intent on building a foolproof pipeline to Brazil, which he hopes directly affects the industry back home. Dealings with hop, yeast and grain suppliers will first fuel Wäls San Diego, and then pave the way for additional contracts to funnel high-quality ingredients into Brazil at a relatively low cost—and hopefully spark relationships between U.S. suppliers and other Brazilian breweries.

As for the beer, if it doesn’t take hold in San Diego, Carneiro has a plan for that, too: Beer exported from the U.S. to Brazil isn’t taxed the same (or as heavily) as domestic beers, which means Wäls San Diego could simply operate as a satellite brewery, exporting its entire volume back to Brazil for less than it would cost to expand and produce beer back at headquarters. From Carneiro’s perspective, it’s a risk-free move. “We can do business in the U.S., and if we don’t sell any beer there, we’ll still have a market in Brazil waiting for us,” he reasons.

For Americans, the new brewery’s an introduction to Brazil’s fastest rising star, and a chance to sample the exotic flavors and hoppy twists of the country’s craft beer scene. But for Brazil, the move has heavier consequences: The potential for high-quality beer at a cheaper price point might open the industry up to new consumers, spur the market share and, in turn, possibly influence policy-makers in Brazil’s National Congress—potential leverage for the developing brewers association.

“We need to help each other, but we’re just starting—like America 25 years ago,” says Carneiro. “It’s growing up, but it could be much better because everybody loves great beer.” •

3 TO TRY: Wäls has already immigrated north; you can find three of its beers in 12 states! The “lightest,” Belô Sao Francisco, is an 8%-ABV Belgian-style dubbel brewed with local raisins, whose deep, dark fruits thread toasted bread flavors. Belô Ipê, a lively Belgian-style quadrupel aged on cachaça oak chips, oozes fruity malts, warming spice and a touch of wood; the equally hefty, 11%-ABV Belô Petroleum blends the sensual, chewy dark malts of an imperial stout with cocoa, coffee and a brooding smokiness. All three beers capture the essence of the homegrown craft beer scene, where brewers update traditional European styles with the flair of indigenous, and often exotic, flavors.